A-92654, MARCH 21, 1938, 17 COMP. GEN. 761

A-92654, MARCH 21, 1938, 17 COMP. GEN. 761

WAR RISK INSURANCE - MULTIPLE SUITS - STATUTORY ATTORNEY FEE LIMITATIONS THE PROVISIONS OF SECTION 500 OF THE WORLD WAR VETERANS' ACT, AS AMENDED BY THE ACT OF MARCH 4, 1925, 43 STAT. 1311, LIMITING ATTORNEYS' FEES IN SUITS BROUGHT UNDER SECTION 19 OF THE ACT TO "NOT TO EXCEED TEN PERCENTUM OF THE AMOUNT RECOVERED," DO NOT REQUIRE THAT IN THE EVENT OF MORE THAN ONE SUIT, THE TOTAL ATTORNEYS' FEES MAY NOT EXCEED TEN PERCENT OF THE ORIGINAL AMOUNT OF INSURANCE AWARDED IN THE FIRST SUIT.

ACTING COMPTROLLER GENERAL ELLIOTT TO THE ADMINISTRATOR OF VETERANS' AFFAIRS, MARCH 21, 1938:

YOUR LETTER OF FEBRUARY 15, 1938, IS AS FOLLOWS:

THERE IS BEFORE THIS ADMINISTRATION FOR SETTLEMENT A SECOND JUDGMENT ENTERED IN THE CASE OF LAWRENCE GOLEN MILES, XC-139,685, IN WHICH THE PAYMENT OF ATTORNEYS' FEES HAS BEEN ORDERED, THE RESULT OF WHICH WOULD APPEAR TO REQUIRE PAYMENTS TO ATTORNEYS IN THE FIRST AND SECOND SUITS FEES IN EXCESS OF THE TEN PERCENTUM (10 PERCENT) AUTHORIZED BY SECTION 500 OF THE WORLD WAR VETERANS' ACT, 1924, AS AMENDED.

THE FIRST SUIT WAS FILED IN THE UNITED STATES DISTRICT COURT, EASTERN DISTRICT OF ARKANSAS, WESTERN DIVISION, BY THE INSURED AGAINST THE GOVERNMENT ON THE QUESTION OF MATURITY OF THE CONTRACT BY PERMANENT AND TOTAL DISABILITY. THE INSURED WAS FOUND TO HAVE BECOME PERMANENTLY AND TOTALLY DISABLED FROM JANUARY 22, 1919, AND MONTHLY INSTALLMENTS OF $28.75 WERE AWARDED TO HIM FROM SAID DATE. WALTER M. PURVIS, LAWRENCE E. GOLDMAN, AND FRANK R. DALEY, ATTORNEYS FOR THE INSURED, WERE AWARDED TEN PERCENTUM (10 PERCENT) OF ALL PAYMENTS RESULTING FROM THE SAID JUDGMENT.

THE VETERAN DIED ON APRIL 8, 1931. THEREAFTER A CONTROVERSY AROSE BETWEEN THE WIDOW, EDNA ESTELLE MILES, WHO CLAIMED TO BE A BENEFICIARY BY REASON OF DESIGNATION, AND THE MOTHER, ANNIE VICKERS MILES, WHO WAS RECOGNIZED AS THE LAST BENEFICIARY OF RECORD BY THE VETERANS' ADMINISTRATION. THIS CONTROVERSY CULMINATED IN A SUIT FILED IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLUMBIA BY THE WIDOW, EDNA ESTELLE MILES, AGAINST THE MOTHER, ANNIE VICKERS MILES, AND THE UNITED STATES OF AMERICA WAS JOINED AS CODEFENDANT. THE MOTHER WAS REPRESENTED BY WILLIAM WOLFF SMITH AND L. L. CRONKRITE. THE COURT, IN FINDING THAT THE MOTHER WAS BENEFICIARY, AWARDED TEN PERCENTUM (10 PERCENT) OF THE INSTALLMENTS PAYABLE TO THE MOTHER TO HER ATTORNEYS.

SINCE THE MONTHLY INSTALLMENTS HAVE ALREADY BEEN REDUCED BY REASON OF THE FEES AWARDED IN THE FIRST JUDGMENT, A FURTHER REDUCTION RESULTED BY REASON OF THE SECOND JUDGMENT IN PAYING THE ATTORNEYS' FEES.

YOUR OPINION IS REQUESTED AS TO WHETHER THERE IS ANY AUTHORITY FOR THE PAYMENT OF ATTORNEYS' FEES TO WALTER M. PURVIS, LAWRENCE E. GOLDMAN, AND FRANK R. DALEY, ATTORNEYS FOR THE PLAINTIFF IN THE FIRST SUIT, AND TO WILLIAM WOLFF SIMITH AND L. L. CRONKRITE, ATTORNEYS FOR THE DEFENDANT, ANNIE VICKERS MILES, IN THE SECOND SUIT, AND HOW THESE FEES ARE TO BE AWARDED IN VIEW OF SECTION 500, WORLD WAR VETERANS' ACT, 1924, AS AMENDED, WHICH APPARENTLY RESTRICTS THE AMOUNT OF FEES TO A SUM NOT TO EXCEED TEN PERCENTUM (10 PERCENT) OF THE AMOUNT RECOVERED.

FOR YOUR CONSIDERATION OF THIS QUESTION THERE ARE SUBMITTED HEREWITH THE FOLLOWING DOCUMENTS:

1. COPY OF JUDGMENT RENDERED BY THE UNITED STATES DISTRICT COURT, EASTERN DISTRICT OF ARKANSAS, WESTERN DIVISION LAW NO. 7008, DATED FEBRUARY 2, 1931, LAWRENCE G. MILES VS. UNITED STATES OF AMERICA.

2. COPY OF JUDGMENT IN THE UNITED STATES DISTRICT COURT OF THE DISTRICT OF COLUMBIA, LAW NO. 86973, RENDERED AUGUST 12, 1937, EDNA ESTELLE MILES, INDIVIDUALLY AS BENEFICIARY OF THE WAR RISK TERM INSURANCE CONTRACT OF LAWRENCE GOLEN MILES VS. UNITED STATES OF AMERICA AND ANNIE VICKERS MILES.

3. COPY OF LETTER DATED NOVEMBER 13, 1937 FROM THE SOLICITOR TO THE DIRECTOR, BUREAU OF WAR RISK LITIGATION, DEPARTMENT OF JUSTICE.

4. COPY OF THE REPLY MADE BY THE BUREAU OF WAR RISK LITIGATION, DATED NOVEMBER 20, 1937.

THE FIRST-MENTIONED JUDGMENT, DETERMINING THE EXISTENCE OR VALIDITY OF THE INSURANCE, AWARDED THE VETERAN $4,168.75 ACCRUED INSTALLMENTS OF $28.75 PER MONTH AND MADE THE FOLLOWING AWARD OF ATTORNEYS' FEES:

* * * TEN PERCENT OF THE TOTAL AMOUNT PRESENTLY DUE THE PLAINTIFF, OR THE SUM OF $416.87, TO EACH OF SAID ATTORNEYS IN THE FOLLOWING PROPORTIONS: 50 PERCENT OF ALL FEES TO SAID WALTER M. PURVIS AND THE REMAINING 50 PERCENT JOINTLY TO SAID LAWRENCE E. GOLDMAN AND FRANK R. DALEY, AND IN THE SAME PROPORTIONS TO SAID ATTORNEYS TEN PERCENT OF THE CURRENT MONTHLY PAYMENTS OF $28.75 OR ANY OTHER SETTLEMENT, IF AND WHEN PAID.

THE JUDGMENT IN THE SECOND SUIT AWARDED TO THE MOTHER OF THE VETERAN THE SUM OF $1,966.50, REPRESENTING ACCRUED UNPAID INSTALLMENTS OF $28.75 PER MONTH SINCE THE DEATH OF THE VETERAN---

* * * LESS TEN PERCENTUM (10 PERCENT) THEREOF, WHICH IS PAYABLE TO WALTER M. PURVIS, LAWRENCE E. GOLDMAN, AND FRANK R. DALEY, AS ATTORNEYS' FEE UNDER AND BY VIRTUE OF THE JUDGMENT ENTERED APRIL 2, 1931 IN THE UNITED STATES DISTRICT COURT OF THE EASTERN DISTRICT OF ARKANSAS, WESTERN DIVISION, AGAINST THE UNITED STATES OF AMERICA, AND IN FAVOR OF LAWRENCE G. MILES; * * *

THE SAME JUDGMENT AWARDED THE MOTHER OF THE VETERAN THE REMAINING UNPAID INSTALLMENTS UNTIL A TOTAL OF $240 HAS BEEN PAID AND MADE THE FOLLOWING AWARD OF ATTORNEYS' FEES:

ORDERED AND ADJUDGED, THAT WILLIAM WOLFF SMITH AND L. L. CRONKRITE, ATTORNEYS FOR DEFENDANT, MRS. ANNIE VICKERS MILES, ARE ENTITLED TO RECOVER AS A REASONABLE ATTORNEYS' FEE, TEN PERCENTUM (10 PERCENT) OF THE AMOUNT HEREIN RECOVERED BY THE SAID DEFENDANT, AND TEN PERCENTUM (10 PERCENT) OF ANY SUMS TO BE PAID BY REASON OF THE RECOVERY HEREIN, ONE-HALF TO EACH OF SAID ATTORNEYS, AND THAT THE ATTORNEYS' FEE UNDER THE AMOUNT HEREIN RECOVERED BE DEDUCTED BY THE DEFENDANT, THE UNITED STATES OF AMERICA, AND PAID TO THE SAID WILLIAM WOLFF SMITH, IN THE SUM OF NINETY-EIGHT DOLLARS AND THIRTY-THREE CENTS ($98.33), AND TO THE SAID L. L. CRONKRITE, THE SUM OF NINETY-EIGHT DOLLARS AND THIRTY-TWO CENTS ($98.32).

IN OTHER WORDS, THE SECOND JUDGMENT DID NOT AWARD AS ATTORNEYS' FEES 10 PERCENT OF THE TOTAL AMOUNT OF THE REMAINING WAR RISK INSURANCE, BUT ONLY 10 PERCENT OF THE AMOUNT RECOVERED BY THE SUCCESSFUL LITIGANT, THAT IS, THE AMOUNT OF PAST AND FUTURE UNPAID INSTALLMENTS REDUCED BY THE ATTORNEYS' FEES AWARDED BY THE COURT IN THE FIRST SUIT. THERE IS NOTHING IN THE ACTION OF THE COURT WHICH SHOULD BE CONSTRUED AS CONTRAVENING THE PROVISIONS OF SECTION 500 OF THE WORLD WAR VETERANS' ACT, AS AMENDED BY THE ACT OF MARCH 4, 1925, 43 STAT. 1311, LIMITING ATTORNEYS' FEES IN SUITS BROUGHT UNDER SECTION 19 OF THE ACT TO "NOT TO EXCEED 10 PERCENTUM OF THE AMOUNT RECOVERED AND TO BE PAID BY THE BUREAU OUT OF THE PAYMENTS TO BE MADE UNDER THE JUDGMENT OR DECREE AT A RATE NOT EXCEEDING ONE-TENTH OF EACH OF SUCH PAYMENTS UNTIL PAID.' NO INFERENCE SHOULD BE DRAWN FROM THE LANGUAGE OF THE ACT, AS WOULD APPEAR TO BE YOUR CONCERN, THAT IN THE EVENT OF MORE THAN ONE SUIT THE TOTAL ATTORNEYS' FEES MAY NOT EXCEED 10 PERCENT OF THE ORIGINAL AMOUNT OF THE INSURANCE AWARDED IN THE FIRST SUIT. THE STATUTE ALLOWS "NOT TO EXCEED 10 PERCENTUM OF THE AMOUNT OVERED.'

YOU ARE ADVISED THEREFORE THAT THE ATTORNEYS IN THE FIRST SUIT SHOULD BE PAID 10 PERCENT OF EACH REMAINING INSTALLMENT OF $28.75, IF ANY, OR $2.87, ALSO 10 PERCENT OF THE ACCRUED UNPAID INSTALLMENTS IF THEY HAVE NOT ALREADY RECEIVED SUCH PAYMENT. THE ATTORNEYS IN THE SECOND SUIT SHOULD BE PAID 10 PERCENT ($28.75 MINUS $2.87 EQUALS $25.88), OR $2.58, IF THERE ARE ANY ACCRUED UNPAID INSTALLMENTS DUE, ALSO $98.33 AND $98.32 SPECIFICALLY AWARDED IN THE SECOND JUDGMENT REPRESENTING 10 PERCENT OF THE AMOUNT OF ACCRUED INSTALLMENTS RECOVERED BY THE MOTHER OF THE VETERAN, THE AGGREGATE OF THE TWO AMOUNTS BEING 10 PERCENT COMPUTED ON THE ACCRUED UNPAID INSTALLMENTS LESS ATTORNEYS' FEES AWARDED IN THE FIRST SUIT. SEE GENERALLY 8 COMP. GEN. 54; ID. 605.